59 N Sussex Dr

Smithfield, NC 27577

$139,900B+

2 bd · 2.0 ba · 1,228 sqft · Built 1989 · MultiFamily · Pending · 65 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,673/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$221
• HOA: −$0
• Vac / Maint / Mgmt: −$561
• Net cashflow: $1,157/mo
• Annual: $13,885/yr
• Cap rate: 16.22%
• Cash-on-cash: 35.45%
• DSCR: 2.58
• 1% rule: 1.91%
• Cash to close: $39,172

Investor read

• This is a 2 × 2-bed/2.0-bath units multifamily listed at $140k.
• At list price, monthly cash flow is $1k ($14k/yr) — positive. Per door: $579/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $140k).
• It's been on market 65 days — a 6% lower offer ($132k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $132k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $967 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 66/100 on livability (#259 in NC) — a middle-class / working-renter tenant base. Strengths: cost of living A+, health & safety A+, housing B+; Watch: crime F, amenities F, commute F.
• Johnston County Public Schools (rural): math 39% / reading 42% proficiency, ranked #105 of 178 in NC (top 59%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Smithfield Middle (math 20% / reading 32%, grade F, #385 of 475 statewide, top 81%, 501 students, 99% FRL); Smithfield-Selma High (math 25% / reading 37%, grade F, #454 of 535 statewide, top 85%, 1,503 students, 69% FRL) — zoned schools average 84% FRL vs 41% district-wide (44 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 28% at this address vs 40% district-wide (-12 pts) — the specific schools serving this property underperform the Johnston County Public Schools average; the district grade overstates school quality for this exact location.
• Market conditions: Rents soft (-1.1%/yr); 407 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 2,783 units permitted in Johnston County in 2024 (6 in 5+ unit buildings).
• Johnston County population projected at +37% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 8 sale attempts since 20y ago; this cycle's ask has dropped $30k (18%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 0.0% rent growth), your $39k cash investment doubles in ~4 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 69% chance of damaging wind over 30y; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 16.2% vs local median 3.5% in Smithfield — top-decile yield for the area; either an underpriced asset or a hidden risk that comps aren't pricing in. Stress-test before assuming the spread holds.
• At $2,673/mo this rent would consume 51% of the median local household income ($63k/yr) (locally 919% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 65 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.